Nifty 50 (24,571) and Nifty Bank (57,746) gained 0.8 per cent each last week, extending their recovery for a second consecutive week. However, the advance lacked strong conviction as the indices spent most of the week consolidating after the sharp rebound seen previously. The derivatives data suggests that while institutional participants continued to pare bearish bets, fresh bullish positioning remained limited.Foreign Institutional Investors (FIIs) turned less bearish. Their net short position in index futures narrowed 13 per cent to 1.50 lakh contracts from 1.73 lakh contracts. At the same time, net long positions in index puts declined 9 per cent to 4.14 lakh contracts, indicating a reduction in downside hedges. However, net short positions in index call options increased 15 per cent to 2.13 lakh contracts, suggesting that FIIs continued to write calls at higher levels despite reducing their futures shorts.The broader positioning was mixed but marginally positive. Combined FII-retail net short positions in index futures shrank 56 per cent to 19,672 contracts from 45,189 contracts, reflecting a significant reduction in bearish exposure. On the other hand, net short positions in index call options widened 54 per cent to 2.47 lakh contracts, while net put shorts narrowed 35 per cent to 1.52 lakh contracts, indicating that put writers became less aggressive in betting on the upside.Overall, the derivatives data indicates that bearish sentiment has eased further, although traders remain cautious at higher levels. From a technical perspective, Nifty continues to hold above 24,500, while Bank Nifty is consolidating around the key 58,000 resistance. A decisive breakout from these levels will determine whether the ongoing recovery gathers fresh momentum.Nifty 50Nifty futures (Aug) (24,655) began last week on the front foot by opening with a gap-up. However, while it hit an intra-week high of 24,758 on Thursday, there was no strong follow-through rally through the week. Nevertheless, the August futures posted a weekly gain of 0.8 per cent. As this happened, the outstanding open interest of this contract dropped 5 per cent to 120.5 lakh contracts, implying short covering in futures.With respect to options, the PCR (Put Call Ratio) of weekly expiry stood at 0.7 whereas that of August monthly contracts was at 1.1 on Friday, suggesting that the option traders broadly hold a positive view.Therefore, futures and options data show a positive bias. However, the chart shows that for the bulls to strengthen their hand, the breakout of 24,750 is necessary.If the resistance at 24,750 is breached, Nifty futures can rally to 25,000 and subsequently to 25,250. Instead, if the contract falls from the current level of 24,655, it can decline to 24,500, a support. Subsequent support is at 24,400. So long as this level holds, the near-term trend will be positive. Strategy: Last week, we suggested buying Nifty futures on a breakout of 24,600. Retain this trade and maintain stop-loss at 24,400. When the contract rises to 24,800 and 24,900, tighten the stop-loss to 24,680 and 24,800, respectively. Book profits at 25,000.Nifty BankNifty Bank futures (Aug) (58,020), after opening last week with a gap-up, was charting a sideways trend through the week. It was oscillating between 57,600 and 58,200. The weekly gain stood at 1 per cent and the open interest of August futures decreased by a marginal 2 per cent to 20.8 lakh contracts. A weekly gain accompanied by a drop in open interest denotes short covering.The PCR of August options stood at 0.90 on Friday. A ratio less than 1 denotes that short positions in call options exceed that of the puts, a bearish sign. However, over the last week, it has increased from 0.85 to 0.90. Although marginal, it shows that call writing was greater recently.Overall, derivatives data shows a bullish inclination in Nifty Bank futures.Chart shows that the August futures saw a daily close above 58,000 on both Thursday and Friday, a positive signal. So, there is a good chance for Nifty Bank futures to gain more traction in the coming sessions, possibly leading to a rally to 60,000 in the near-term.In case the contract falls from the current level of 58,020, it can find support at 57,600 and 57,000. The next support is at 56,500.Strategy: Last week, we suggested buying Nifty Bank futures (Aug) on a breakout of 58,000. Traders who initiated this position can hold on with a stop-loss at 57,000.When the contract rallies to 59,000 and 59,500, raise the stop-loss to 58,250 and 59,000 respectively. Book profits at 60,000.Published on August 8, 2026